1999 Kansas Oil and Gas Production:

An Examination of the Importance of Stripper Production

Kansas Geological Survey Open-File Report 2000-16

Timothy R. Carr

Introduction

This Open-File report builds on Carr and Gerlach (1997, 1998) in an attempt to develop a perspective on the trends in the relative importance of stripper well production to Kansas oil and gas production. Stripper wells are economically marginal oil and gas wells that produce at relatively low rates. The definition of stripper wells varies. For oil, stripper production is usually defined as production rates of between 5 and 15 barrels of oil per day (BOPD). Stripper gas production would generally be anything less than 90 thousand cubic feet per day (MCFPD).

Wells that are producing at stripper well rates make up a significant portion of Kansas oil and gas production, and more importantly represent a very large portion of existing well bores. These well bores represent a very large capital investment that is at risk of being plugged and abandoned.

Procedure

We examined the most recent available production data from the Kansas Department of Revenue from the period of January through May 1999. This provides a five-month period to average production and to capture leases reporting production only on an intermittent basis. All leases that produced any oil or gas during the five-month period were extracted from the oil and gas production database. Lease production was divided by the number of wells listed for each lease and then by 150 days to obtain an estimated average daily production per well.

Results: Oil Production

Oil production in the first five months of 1998 was reported from 12,727 leases with 37,462 wells (Table 1a). The number of producing leases and wells have decreased significantly from 1998 (13,998 leases and 41,520 wells as reported by Carr and Gerlach, 1998). For the comparable five month period producing wells and leases decreased by more than 9%, while production decreased 10.1%. The majority of decreased production is from stripper wells making less than 5 BOPD. In fact these stripper wells account for over 100% of the decrease in both producing wells and leases, and 72% of the decrease in the oil production from 1998 to 1999. This decrease in both producing leases and wells can be attributed to the extremely low well head price during the first half of 1999. The average posted price for Kansas crude was $11.72 during the first five months of 1999.

Total oil production in the first five months of 1999 was 13,590,896 barrels of oil (Table 1a). This is an average monthly production of 2,718,179 barrels of oil. Average daily per well production would be 2.4 barrels of oil. The reported 1999 production represents a 10.1% decline compared to the first five months of 1998.

The number of oil wells grouped by production rate shows that over 98% of the oil wells in Kansas average less than 15 BOPD (Table 1a). Approximately 36,885 wells producing 74.8% of the state's oil would be considered as stripper production. This represents a very large number of well bores that are at significant risk to abandonment.

Table 1a -- Kansas Oil Production from January through May 1999
  Producing Leases Producing Wells Oil Production
BOPD/Well Number % of Total Cum % Number % of Total Cum % Barrels % of Total Cum %
< 5 10118 79.5% 79.5% 33104 88.4% 88.4% 6,259,179 46.1% 46.1%
5.01-10 1723 13.5% 93.0% 3236 8.6% 97.0% 2,968,203 21.8% 67.9%
10.01-15 388 3.0% 96.1% 545 1.5% 98.5% 932,147 6.9% 74.8%
15.01-20 159 1.2% 97.3% 194 0.5% 99.0% 485,937 3.6% 78.3%
20.01-30 140 1.1% 98.4% 159 0.4% 99.4% 564,519 4.2% 82.5%
30.01-40 77 0.6% 99.0% 95 0.3% 99.7% 488,941 3.6% 86.1%
40.01-50 40 0.3% 99.4% 45 0.1% 99.8% 299,419 2.2% 88.3%
50.01-75 43 0.3% 99.7% 45 0.1% 99.9% 393,475 2.9% 91.2%
75.01-100 16 0.1% 99.8% 16 0.0% 99.9% 200,742 1.5% 92.7%
100.01 23 0.2% 100.0% 23 0.1% 100.0% 998,334 7.3% 100.0%
Totals 12,727 100.0%   37,462 100.0%   13,590,896 100.0%  

Data Source: Kansas Department of Revenue

 

Results: Gas Production

Gas production in the first five months of 1999 was reported from 15,468 leases with 17,146 wells (Table 2a). Total production was 218.7 billion cubic feet. This is an average monthly production of 43.7 billion cubic feet. Average daily per well production would be 85 MCF. The reported 1999 gas production represents a 8% decline compared to the first five months of 1998, and reflects production declines in the gas fields of southwest Kansas.

The number of gas wells grouped by production rate shows that 63% of the gas wells in Kansas average less than 90 MCFPD (Table 2a). Approximately 10,772 wells producing 24.1% of the state's gas would be considered as stripper production.

Table 2a -- Kansas Gas Production from January through May 1999
 

Producing Leases

Producing Wells

Gas Production
MCFPD/Well Number % of Total Cum % Number % of Total Cum % MCF % of Total Cum %
0.1-40 5210 33.7% 33.7% 6780 39.5% 39.5% 14,949,983 6.8% 6.8%
40.01-60 1786 11.5% 45.2% 1833 10.7% 50.2% 13,742,572 6.3% 13.1%
60.1-90 2123 13.7% 59.0% 2159 12.6% 62.8% 24,011,095 11.0% 24.1%
90.01-120 1854 12.0% 70.9% 1867 10.9% 73.7% 29,408,431 13.4% 37.5%
120.01-150 1365 8.8% 79.8% 1367 8.0% 81.7% 27,732,643 12.7% 50.2%
150.1-300 2747 17.8% 97.5% 2755 16.1% 97.8% 82,913,492 37.9% 88.1%
300.1-450 281 1.8% 99.3% 283 1.7% 99.4% 14,913,812 6.8% 94.9%
450.1-600 56 0.4% 99.7% 56 0.3% 99.7% 4,310,961 2.0% 96.9%
600.01 46 0.3% 100.0% 46 0.3% 100.0% 6,753,745 3.1% 100.0%
Totals 15,468 100.0%   17,146 100.0%   218,736,734 100.0%  

Data Source: Kansas Department of Revenue
References Cited

Carr, Timothy R. and Paul M. Gerlach, 1997, Kansas oil and gas production: An examination of the importance of stripper production: Kansas Geological Survey Open-File Report 97-64, 4p.

Carr, Timothy R. and Paul M. Gerlach, 1998, Kansas oil and gas production: An examination of the importance of stripper production: Kansas Geological Survey Open-File Report 98-50, 5p.

April 2000
URL: http://www.kgs.ku.edu/PRS/publication/2000/ofr2000-16/index.html